California has given dentists nearly $130 million in incentive payments in the last two years in return for treating more low-income children.

While only 45.3 percent of children with Denti-Cal, the state’s low-income dental program, received preventative care at a dentist’s office in 2017, that’s 20 percent more than did before the state improvements began. In 2014, two years before the Dental Transformation Initiative launch, less than 38 percent of children in Denti-Cal received any sort of preventative care.

The number of dentists providing preventative care services to Denti-Cal enrollees also increased more than 7 percent, and the number of individual services provided has climbed by 14.8 percent.

“We think it’s a great improvement,” said Eileen Espejo, senior managing director for media and health policy for Children Now, an Oakland-based advocacy group. “Any way to increase utilization is critical.”

About half of California’s children are enrolled in Denti-Cal, the Medi-Cal dental insurance program.

In addition to increasing preventative dental care, the state’s Dental Transformation Initiative is focused on continuity of care, assessing and managing tooth decay, and local pilot projects. Preventative treatments that fall under the continuity of care category have increased 27.7 percent between 2014 and 2017. A total of $2 million in incentive payments for assessing and reducing the risk of tooth decay began in 2017, according to the state Department of Health Care Services, which oversees Denti-Cal.

“The Department of Health Care Services is satisfied with what has been accomplished under the Dental Transformation Initiative,” Tony Cava, an agency spokesperson, said in an email.

Paul Glassman, a dentist, professor at the University of the Pacific in San Francisco and principal investigator for all the Dental Transformation Initiative subcontractors, noted that the program got off to a slow start in terms of handing out contracts.

“It’s turning out to be less than a four-year initiative,” Glassman said. “Things are going better now.” The initiative ends in 2020.

Espejo noted that the dozen local pilot projects, which the state has spent $16.3 million on to date, have shown some success. One of the pilots, known as a virtual dental home, is being deployed in five counties. Dental hygienists use portable equipment to x-ray children in schools, and the x-rays are electronically transmitted to dentists for further examination. The hygienists can also perform what are known as an interim therapeutic restoration—essentially a filling that can be inserted without drilling.

Glassman, who oversaw a six-year proof-of-concept project for virtual dental homes before they were operated under the initiative, noted there are about 40 hygienists working in conjunction with about 30 dentists and federally qualified health clinics to provide the virtual home care. The project is working as well in cities as it is in rural areas.

“About two-thirds of very low-income kids could be kept healthy without seeing a dentist,” Glassman said.

According to Espejo, there are also promising pilots in place to train primary-care physicians to check on the oral health of their pediatric patients, and one at UCLA that analyzes electronic medical records for patients in need of potential dental care. Specific data about the efficacy of the pilots was not immediately available. Glassman noted that the gathering and transmission of data to the state for the pilot projects is an issue that has yet to be fully resolved.

The Health Care department acknowledges that more challenges for the initiative lie ahead. Cava noted that one of the biggest challenges is changing perceptions toward preventative dental care.

“The general public doesn’t normally prioritize the mouth and dental care for preventive maintenance like they do for medical care,” he said. “People tend to go to the dentist when they are in pain versus routine care. DHCS is trying to change that dynamic.”

For 2019, the agency has expanded exams for dental decay into 18 additional counties, for a total of 29, and increased focus on continuity of care in 19 new counties, for a total of 36.

However, whether the initiative will be a long-term success remains to be seen. While Cava noted that the agency will issue a comprehensive report in 2021, there is some skepticism about whether or not any progress will be sustainable.

Both Espejo and Glassman agree that many dentists in California remain reluctant to treat Denti-Cal enrollees, primarily because the extra reimbursement from government programs tends to be transient. Should the hundreds of millions being spent under the initiative disappear, it is quite possible the recently recruited providers will retreat.

“There are still a lot of lessons to be learned about what is working and not working,” Espejo said.

Spending per member in commercial plans on medical pharmacy drugs increased by nearly 20% between 2016 and 2017, due in part to the growing number of emerging therapies with high price tags.

Magellan Rx Management, the pharmacy benefit management arm of managed-care company Magellan Health, released its ninth annual trend report diving into spending on drugs administered by providers, and it found that per-member, per-month spending on these therapies increased by 18% from 2016 to 2017, reaching an average of $29.97 monthly, for people enrolled in commercial plans.

Spending on provider-administered drugs in Medicare also went up, the study found. Per-beneficiary, per-month spending increased by 12% in that same window, to an average of $52.19.

The findings put a spotlight on focus areas for PBMs and payers to more effectively monitor use and control costs for these drugs, Kristen Reimers, senior vice president for specialty clinical solutions, told FierceHealthcare.

“In previous years, drug pricing and inflation have really been the drivers of trend. This year, our analysis showed that drug spend was driven overwhelmingly by an increase in unit volume—in other words, more specialty medical benefit drugs are being utilized,” Reimers said.

Drugs administered in hospitals continue to be the most expensive, the report found, typically costing between two and three times more than those administered at a doctor’s office or through home health.

But payers are taking notice—68% now use a site-of-service program to mitigate these expenses, Magellan found.

Spending on emerging oncology treatments—particularly immunotherapy—are also a major driver, according to the study. Treatments in the antihemophilic factor category, for example, increased spending by 62% year over year in commercial plans and 185% in Medicare for patients given these therapies.

Chimeric antigen receptor T-cell therapy, which Medicare may begin to cover in the near future, alone is projected to drive per-member monthly spending up by 581% for patients who are prescribed these treatments. The highest per-member, per-month spending across all service lines was also reported in oncology, Magellan found.

In addition to diving into claims data from 45 commercial insurers—33 of which also administer Medicare Advantage plans—Magellan also surveyed leaders at these payers. Just over half (51%) have instituted step therapy to manage these drug costs, and 64% said the cost of biosimilars, in oncology especially, is playing a significant role in their reimbursement plans.

And more of these drugs are on the horizon—Magellan projects that there will be 43 billion dollar therapies on the market by 2021.

“The big story again this year was the increase in oncology immunotherapy products,” Magellan’s researchers said. “Medical pharmacy continues to be driven by low-volume, high-cost specialty medications.”

That simple phrase is loaded with political baggage, and often accompanied by vague promises and complex jargon. Different candidates use it to target different voter blocs, leading to sometimes divergent, even contradictory ideas.

“People are talking about this as a goal, as a commitment, as a value as much as a specific program,” said Celinda Lake, a Democratic pollster.

In championing “Medicare-for-all,” politicians often put forth a general idea: universal health care, or some system in which everyone can afford medical care. But their visions for achieving that vary wildly.

Sometimes Medicare-for-all is meant to promise a single-payer health care system —meaning everyone is covered by one, often government-run health plan. In other cases, politicians who say they support “for all” actually mean “for more.”

Every proposal brings its own trade-offs.

“There’s not just one easy answer to what a single-payer system would do to the United States,” said Jodi Liu, an economist at the nonprofit Rand Corp. who studies single-payer proposals. “What happens depends on how that change is being designed, and how it’s being implemented.”

Here’s a primer on the Medicare-for-all debate. Keep it in your back pocket: This argument won’t be disappearing anytime soon.

Isn’t Medicare-for-all what it sounds like? Medicare for everybody?

Not quite. But also, kind of.

Politicians talking about Medicare-for-all typically mean one of two things. It’s either a specific proposal in which every American is covered by the same, single health plan, or the general idea that anyone has the option to get health care through Medicare.

The first understanding is outlined in a bill from Sen. Bernie Sanders (I-Vt.). Co-sponsors include Senate Democrats like Elizabeth Warren of Massachusetts, Kamala Harris of California, Cory Booker of New Jersey, Kirsten Gillibrand of New York and Jeff Merkley of Oregon. All have either announced a run for president or indicated they are strongly considering one.

And they are talking about this on the campaign trail.

Sanders’ bill would outlaw private insurance where it competes with the public plan and change Medicare substantially by eliminating copays and other cost sharing, while expanding the program to cover long-term care, prescription drugs, dental care and vision. (As the bill is written, it’s hard to see what would be left for private plans to cover.)

The program would phase in over four years and cover every American. And it’s worth noting that, though many countries run a single-payer system, none offers all of those “expanded” benefits because the expense could be enormous. Also, many single-payer programs do require a degree of cost sharing, involving small copayments or deductibles.

In other cases, the “Medicare-for-all” phrase has been repurposed.

The midterms saw a wave of Democrats campaigning on it. But beyond the buzzwords, what they were actually talking about was lowering Medicare’s eligibility age or giving people the option to buy in or join the program. This would leave the private insurance industry intact. It would also preserve Medicare Advantage, in which the government pays private companies to run Medicare plans.

For many voters, it’s less about granular details and more about the principle, Lake suggested: “The highest level of support is when you talk about [Medicare-for-all] generally.”

So are Democrats saying we should get rid of private insurance?

Democrats who have signed on to Sanders’ bill have endorsed legislation that would outlaw virtually all private health insurance. That’s controversial.

Private insurance covers the largest share — 56 percent in 2017 — of Americans. And voters are often afraid of losing what they have if it’s uncertain they’ll get something better in exchange. Just ask then-President Barack Obama, whose Affordable Care Act-related promise that “if you like your plan, you can keep it” sparked sharp backlash after proving untrue.

This gets at a key question: Can Medicare-for-all advocates convince voters they’ll replace their health plans with something better?

After all, most Americans say they support Medicare-for-all. But some of the same polls indicate that most people with employer-sponsored insurance think their coverage would be unaffected by the switch. That’s false.

Critics also say eliminating private insurance could gut a major sector of the health economy. As of December 2018, private health coverage was directly responsible for almost 540,000 jobs, according to the Bureau of Labor Statistics. Economists note, though, that predicting how many jobs would go away — versus how many could be absorbed by the new system — is difficult, as is projecting any macroeconomic impact.

The magnitude of such a change underscores why some Democrats are trying to tread lightly for fear of land mines.

When probed on Medicare-for-all, Harris said she supported eliminating private insurance — while also saying she would, in the interim, back other bills that expand access to health care. Warren, in a televised interview, sidestepped specifics altogether. And Booker told reporters he would not outlaw private health care, noting that many other countries have achieved universal coverage without taking this step.

For example, Germany has universal health care but leaves private insurance intact, while heavily regulating the industry and requiring plans be not-for-profit.

So what other options are Democrats talking about?

Voters should get familiar with two other ideas: lowering Medicare’s eligibility age, and the “public option,” either through a Medicare or Medicaid buy-in.

These concepts are decidedly not Medicare-for-all — think “Medicare for more“ or “Medicaid for more.”

Lowering the eligibility age loops more people into the current system and is seen by advocates as a potential step toward single-payer, said Alex Lawson, head of the left-leaning Social Security Works, who has been involved in drafting Medicare-for-all legislation.

The public option lets people purchase coverage through Medicare or Medicaid. It has attracted criticism from Democrats aligned with the Sanders wing, who argue it’s settling for less.

Senate Democrats have introduced bills advancing such ideas — including Merkley, who pushed a Medicare-based public option to let individuals and employers buy Medicare coverage, while also attaching himself to Sanders’ measure. A proposal from Sens. Tim Kaine (D-Va.) and Michael Bennet (D-Colo.) would extend that option only to individuals. (Bennet is also purportedly weighing a 2020 bid.)

People would not pay what they currently do for health insurance, an outlay that’s only getting more expensive. They would also likely get more generous health coverage. And lawmakers are pitching various other bills — see Warren’s wealth tax, Sanders’ estate tax or the 70 percent marginal tax on the wealthy touted by Rep. Alexandria Ocasio-Cortez (D-N.Y.) — that backers argue would generate revenue to pay for something like Medicare-for-all.

Perhaps more significant, at least politically, are the implications for health care stakeholders like hospitals, insurers and drugmakers. All stand to lose under single-payer, especially if it’s used to bring down health care costs.They’re already working to make their opposition felt. (That said, opposition from the health industry is not universal.)

When Democrats say they want Medicare-for-all, then do they really mean single-payer?

There has been a lot of brouhaha on this.

Take the backlash when Harris, after backing single-payer, said she also supported “Medicare-“ and “Medicaid for more”-type policies. Her spokesman compared that to “wanting a burrito” while being willing to accept tacos in the meantime.

Of course, Harris isn’t the only one to straddle those plans. Merkley, Gillibrand, Booker and Warren have put their names to multiple health reform bills. So, in fact, has Sanders, who voted to support, among other bills, the Affordable Care Act — decidedly not single-payer.

So are Democrats wavering? Is saying “Medicare-for-all,” or even single-payer, a hook to win votes, or a bargaining strategy to end up with a public option instead?

It just isn’t that simple.

“None of us can see into the hearts of anybody. And it’s not a low-bar thing to sponsor a bill,” said Lawson of Social Security Works. In a presidential campaign, though, “people will want to hedge.”

Democrats and the Trump administration are beginning to hold talks on lowering drug prices as they look for a rare area of common ground.

Both President Trump and congressional Democrats say that lowering drug prices is a priority, providing a potential area for bipartisan action in a government that is otherwise bitterly divided after a months-long fight over border security.

But the political risks are high for both sides in a politically polarized atmosphere and with the 2020 elections rapidly approaching.

Trump and Speaker Nancy Pelosi (D-Calif.) spoke briefly about working together to lower drug prices during a phone call at the end of January and their staffs have begun preliminary discussions, according to a Democratic aide.

Rep. Peter Welch (D-Vt.), one of the House’s fiercest critics of the pharmaceutical industry, also spoke with acting White House chief of staff Mick Mulvaney during a trip to Camp David last weekend.

And Secretary of Health and Human Services Alex Azar has been talking to dozens of congressional Democrats, including House Ways and Means Committee Chairman Richard Neal (D-Mass.). He also met with Democrats on the Senate Finance Committee on Wednesday.

“We’re hopeful,” Welch told The Hill. “I spent some time at Camp David talking with Mick Mulvaney about it.”

“He brought it up, he was just very affirmative about the president’s desire to make some progress on this,” Welch added.

Despite the flurry of talks, there is still plenty of reason to doubt that a breakthrough on drug prices, or any major bipartisan goal, can be accomplished. Democrats and Trump are still dealing with the fallout from the border wall standoff, and bracing for a contentious legal fight after the president on Friday declared a national emergency at the border.

Trump has also recently cast doubt on working with Democrats, who with control of the House have stepped up their investigations into his campaign and administration. During his State of the Union address, he derided them as “ridiculous partisan investigations,” and warned the probes would hurt the chance for bipartisan achievements.

And with 2020 quickly approaching, a number of Senate Democrats have jumped into the presidential race, complicating hopes for a bipartisan deal. For some Democrats, there is little upside to giving Trump a major legislative victory heading into an election.

And both sides are rife with skeptics that those across the table are ready to push ahead on the issue.

“I think the administration needs to stand up to the drug lobby and they won’t any more than they stand up to the gun lobby or Wall Street,” said Sen. Sherrod Brown (D-Ohio), a possible presidential candidate who attended the meeting with Azar on Wednesday.

Still, Brown called Azar “very smart” and said the administration had proposed “a few good things” on drug prices.

Other key Democrats struck a more hopeful note.

Neal, the Ways and Means chairman, said at a hearing on drug prices on Tuesday that he has had “encouraging conversations” with Azar, specifically on a proposal to make drug companies pay rebates back to the government if their prices for certain drugs in Medicare Part B rise faster than the rate of inflation.

“Secretary Azar and the Trump Administration are committed to working across the aisle and have made it clear that all options that preserve drug safety, protect innovation, and keep patients at the center are on the table,” Health and Human Services spokeswoman Caitlin Oakley said in a statement after Azar’s meeting with Senate Democrats on Wednesday.

House Democratic leaders are planning to move first on a package of “low-hanging fruit” drug pricing bills that are smaller measures that have some bipartisan support, before later moving on to more partisan proposals like allowing Medicare to negotiate drug prices.

It is possible that the smaller, bipartisan measures could make it through the Senate as well, given that Senate Finance Committee Chairman Chuck Grassley (R-Iowa) supports several of the key components, such as preventing drug companies from using gaming tactics to delay competition from cheaper generic drugs.

House Democrats are then expected to move on to a more partisan bill on allowing Medicare to negotiate drug prices. That measure has little, if any, chance of making it through the Senate but will allow Democrats to showcase their priorities.

Democratic leaders have begun working on the Medicare negotiation bill, but have not yet settled on the details. One major question is what enforcement mechanism they will include in the bill to force drug companies to the table if they decline to negotiate.

“We’re working on it; we don’t have a draft yet,” House Energy and Commerce Committee Chairman Frank Pallone Jr. (D-N.J.) said of the Medicare negotiation bill on Wednesday.

The vast number of issues at play in drug pricing and the large number of important players, on Capitol Hill and beyond, make the prospect of any action challenging.

Still, in the upper chamber, one senior lawmaker held out hope that the administration and Democrats could move forward.

Sen. Ron Wyden (D-Ore.), the top Democrat on the Senate Finance Committee, said that he secured a commitment from Azar at the meeting Wednesday to work with him on another priority, Wyden’s bill to cap seniors’ out-of-pocket drug costs in Medicare.

“He started in talking about how much he favors an out of pocket limit for seniors and I said ‘Secretary, I’ve had a bill on that for two years,’ and finally I said, ‘Will you send your people over to talk to mine so we can pass that bill quickly?’ ” Wyden recounted.

Wyden said that Azar agreed.

“If the administration will do what they said they were going to do,” Wyden added. “I said, ‘I’ve had this bill for two years, let’s go’ and he said, ‘Ok.’ ”

California Gov. Gavin Newsom says he’s done waiting for the federal government to curtail the rising cost of prescription drugs.

Newsom has his own plan to ease that financial burden — one he hopes other states can join or replicate.

The Democratic governor said he intends to use California’s might as the world’s fifth-largest economy to demand lower prices directly from drug companies for millions of Medicaid enrollees, state government workers and, eventually, Californians in the private sector.

“I recognize deeply the anxiety so many of you feel around the issues related to the cost of prescription drugs,” Newsom said in a Facebook Live video when announcing his initiative. “And I hope California’s efforts here can lead the way to other states to consider the same.”

Newsom said later he’s already “talking to other state governors about how they can participate.”

Whether he can deliver on his ambitious pledge to take on big pharmaceutical companies is far from certain. The plan he introduced his first day in office is based on broad ideas, with few details and start dates that may be years away.

States have taken smaller steps to rein in drug prices and achieved limited savings. But the issue has stymied lawmakers at the federal level, including President Donald Trump, who called for lowering the cost of prescription drugs in his State of the Union address last week.

Lawmakers face an array of challenges that make reform hard, such as secretive drug pricing and the political influence of the pharmaceutical industry, one of the most powerful lobbies in the country, said Rachel Sachs, an associate professor at Washington University in St. Louis who specializes in health law.

“Drug pricing is one of the most complicated areas within a complicated health care system,” Sachs said.

In California, the amount the state government spends on prescription drugs has risen 20 percent per year since 2012, according to Newsom’s executive order.

To stem that rise, he wants the state Department of Health Care Services — which oversees Medi-Cal, the country’s largest Medicaid program, for low-income residents — to negotiate prescription drug prices for all of its roughly 13 million enrollees by 2021.

Currently, the vast majority of Medi-Cal enrollees get their prescription drugs through managed-care plans that contract with the state to provide Medi-Cal coverage — a fragmented system that doesn’t yield the best price for consumers, the Newsom administration argues.

With the state in charge of negotiations, Medi-Cal could save $150 million a year, the administration said, and Medi-Cal enrollees could go to virtually any pharmacy, as opposed to the limited options authorized by their health plans.

Although the concept of bulk purchasing might sound good, health experts say, the state faces barriers.

Federal law requires Medicaid programs to cover most drugs approved by the Food and Drug Administration. That leaves states without one of the biggest bargaining chips available to the private sector: the ability to tell drugmakers they won’t buy their products.

But California can get creative, said Jennifer Kent, the health department’s director. For example, the state can create a preferred drug list that gives drugmakers an incentive to reduce their prices. If a medication is on the list, doctors don’t need to obtain preauthorization from Medi-Cal to prescribe it, making it more accessible and thus more likely to be used by patients, Kent said.

In addition, the sheer size of California’s Medi-Cal program can help drive down prices, Kent said.

“I think of us as the third-largest public purchaser in the nation” behind Medicare and the Department of Veterans Affairs, Kent said. “We cover a very significant number of people.”

But representatives for California health plans and pharmacy benefit managers, the middlemen who negotiate with drugmakers on behalf of health plans and government entities, say their organizations already work to find the best prices for consumers. They haven’t publicly opposed Newsom’s plan but have expressed skepticism.

The Pharmaceutical Care Management Association, which represents pharmacy benefit managers, said in a written statement that its companies are set to save the California Medi-Cal program $8.59 billion in projected costs from 2016 to 2025.

Drugmakers have launched a national campaign that blames insurers for failing to pass along more than $150 billion a year in rebates and discounts to consumers.

In addition to negotiating for Medi-Cal enrollees, Newsom wants to get a better deal for state workers. He has directed his administration to study how agencies could band together in a separate drug-purchasing pool to buy prescription drugs as one entity.

Currently, more than 20 state agencies negotiate drug prices separately.

Newsom said he envisions private purchasers — including small businesses, health plans and self-insured Californians — eventually joining these state agencies at the bargaining table in a bid to “marshal public and private parties” for lower drug prices.

A report last year by the National Academy of Sciences found that spending on biopharmaceuticals accounts for nearly 17 percent of America’s annual health care bill, and that many people have difficulty paying for the drugs they need.

Among the report’s recommendations to lower costs: The federal government should consolidate its purchasing power and directly negotiate prices for all federal health care programs, including Medicare and Department of Veterans Affairs coverage. However, legislation to do that within Medicare has stalled repeatedly over the years and remains controversial.

Trump’s proposal last year to link Medicare spending for certain drugs to what other industrialized countries pay has gone nowhere. Last month, the Trump administration proposed a new prescription drug discount plan that would steer the rebates drug companies now give to insurers directly to consumers.

In the absence of federal action, states have sought to curb drug prices on their own. Among those efforts: a Connecticut law requiring drug companies to justify price increases, a California law requiring them to report price hikes, and a New York cap on drug spending in the state’s Medicaid program.

Twenty-eight states and the District of Columbia belong to multistate purchasing pools, mostly for their Medicaid programs. But data about how much money these pools have saved is scarce, said Edwin Park, a research professor at Georgetown University’s Center for Children and Families.

“I think there are real opportunities and real interest in the states about leveraging their buying power,” said Trish Riley, the executive director of the National Academy for State Health Policy. “The states can’t wait for federal action.”

Under the most recent proposal, people between the ages of 50 and 65 could buy a Medicare plan and qualify for subsidies and tax credits under the Affordable Care Act (ACA). The Medicare at 50 Act, led by Sen. Debbie Stabenow, D-Mich., would fund enrollment through premiums and would eventually lower costs for younger people by moving more people into the higher age bracket, its sponsors argue.

However, David Merritt, executive vice president of public affairs and strategic initiatives at America’s Health Insurance Plans (AHIP), called the proposal a “slippery slope to government-run healthcare for every American.”

Merritt told FierceHealthcare that U.S. healthcare is not a one-size-fits-all system and that a vast majority of Americans are satisfied with the coverage they have today, whether it be through Medicare Advantage, Medicaid or private coverage.

“They have choice and control over their coverage, options, and treatment,” Merritt said. “Instead of taking away the coverage that works for them today, let’s focus on protecting and improving what’s working and fixing what’s not. That’s the most effective way to guarantee that every American has affordable coverage and high-quality care.”

The Federation of American Hospitals (FAH) shares similar concerns, saying in a blog post that the bill “would harm more Americans than it would help.” The post said that allowing more people into the Medicare program would weaken the system for those who are already in it.

Instead, the FAH suggests that “Congress should work to sustain and expand affordable private coverage.”

In a recent blog post, the American Hospital Association’s (AHA) president and CEO, Rick Pollack, reiterated his support for strengthening the existing Affordable Care Act and expanding Medicare, but cautioned not to resort to a one-size-fits-all approach.

He argues that this form of government-run coverage poses risks to many U.S. citizens.

“If Congress controls all payments to providers, delivery system reforms to improve care, enhance quality and reduce costs may no longer be a priority as the government would be able to simply ratchet down reimbursement,” Pollack wrote in a blog post earlier this year.

Despite the concern from the industry, plans to expand Medicare are popular with voters. According to a recent poll from the Kaiser Family Foundation, 77% of the public supports offering Medicare to those 50 and older.

When Michelle Fenner signed up to run this year’s Los Angeles Marathon, it got her thinking: Tijuana, Mexico, is only a 2½-hour drive from L.A. Why not take a trip across the border and buy some insulin for her son?

“It’s so easy to just go across the border,” mused Fenner.

This idea had been in the back of Fenner’s mind for a while. Her son was diagnosed with Type 1 diabetes nine years ago, meaning he needs daily injections of insulin to live. The list price of the modern generation of insulin has skyrocketed since his diagnosis. On one trip to the pharmacy last year, Fenner was told that a three-month supply of insulin would cost her $3,700.

That same supply would cost only about $600 in Mexico.

So, when she booked her trip to Los Angeles, Fenner said, “I decided we need to update our passports and go and get more insulin.”

Fenner is not the only one thinking like this. The U.S. government estimates that close to 1 million people in California alone cross to Mexico annually for health care, including to buy prescription drugs. And between 150,000 and 320,000 Americans list health care as a reason for traveling abroad each year. Cost savings is the most commonly cited reason.

‘Right To Shop’ Legislation

In Utah last year, the Public Employee Health Plan took this idea to a new level with its voluntary Pharmacy Tourism Program. For certain PEHP members who use any of 13 costly prescription medications — including the popular arthritis drug Humira — the insurer will foot the bill to fly the patient and a companion to San Diego, then drive them to a hospital in Tijuana, Mexico, to pick up a 90-day supply of medicine.

“The average cost of an eligible drug in the US is over $4,500 per month and is 40-60% less in Mexico,” PEHP clinical services director Travis Tolley said in an announcement of the program in October.

The program was part of a “Right to Shop” bill championed by health care economist and Utah state representative Norm Thurston in 2018. Thurston said there is not yet enough data to know how much in savings the program provides; the first patients traveled to Tijuana in December.

But, Thurston said, he expects that in the next six months, savings will likely be “in the ballpark of $1 million.”

There are some questions about traveling abroad to buy prescription drugs, however. The first: Is it legal?

According to the Food and Drug Administration, “in most circumstances, it is illegal for individuals to import drugs into the United States for personal use.” But the agency’s website does provide guidance about when it could be allowed. And the U.S. Customs and Border Protection’s website has a whole section on traveling with medications in its “Know Before You Go” guide.

While the guidelines may still raise questions, Thurston said, this sort of purchase for personal useis a widely established practice.

“When we talked to people about this, there has never been a single person who has been prosecuted for doing it. And it happens every day at every border crossing all over the country,” Thurston said.

“The general understanding is you can bring up to a 90-day supply of a prescription from overseas, even though it’s a technical violation,” said Nathan Cortez, a law professor at Southern Methodist University.

“My sense is the FDA does not want to worry about individuals going overseas and bringing back small amounts of prescriptions that last a few months,” Cortez said, adding, “That doesn’t mean the FDA couldn’t change its mind at any point and start cracking down.”

A second major concern that comes up in any discussion of medical tourism is about the quality of that imported medicine. According to the FDA, the reason it’s mostly illegal to import drugs is because the agency “cannot ensure the safety and effectiveness” of those drugs. In 2017, the World Health Organization estimated that 10 percent of drugs in developing countries were either substandard or falsified.

To address that problem, the Utah program sends its patients only to a designated, accredited Mexican hospital. Individual patients like Michelle Fenner are left to take their own precautions.

“You get a little nervous. You want to make sure that you have a reputable pharmacy,” Fenner said. To get pharmacy recommendations, she has been consulting with friends and acquaintances who have purchased insulin in Mexico. She’s calling those pharmacies now to make sure they have the type of insulin she wants to buy. When the March 24 marathon gets closer, she’s planning to call ahead with her order.

Fenner, who splits her time between Dallas and Arvada, Colo., said the amount she’s expecting to save on insulin could warrant multiple trips to Mexico every year.

Global Savings

Fenner is just one of the growing number of activists online who are discussing the great lengths they go to — sometimes literally — to afford insulin. Lija Greenseid is another. Her daughter has Type 1 diabetes.

Almost one year to the day after her daughter’s diagnosis, Greenseid and her family were visiting Quebec City, Canada, in July 2014. Her daughter’s blood sugar started spiking and Greenseid feared her insulin might have gone bad, so she went to a pharmacy. With no prescription and fearing that her daughter’s life was on the line, Greenseid was prepared to pay a fortune.

Instead the box of insulin pens that normally costs $700 in the U.S. was only around $65 or so.

“At that point I started tearing up. I could not believe how inexpensive it was and how easy it was,” Greenseid said.

“I said to [the pharmacist], ‘Do you have any idea what it’s like to get insulin in the United States? It’s just so much more expensive.’ And he turned to me and said, ‘Why would we want to make it difficult? You need insulin to live.’”

The more Greenseid traveled with her family, the more they realized how inexpensive insulin was everywhere except in the United States. In Nuremberg, Germany, she could get that $700 box of insulin pens for $73. The same box was $57 in Tel Aviv, Israel, $51 in Greece, $61 in Rome and $40 in Taiwan.

“We get so accustomed in the United States to thinking that health care has to be difficult and so expensive that people don’t even consider the fact that it could be so much easier and less expensive in other places,” Greenseid said. “In fact, that is the case in most countries.”

At the same time, Dr. Scott Gottlieb, the agency’s commissioner, suggested that Congress strengthen the F.D.A.’s authority over an estimated $40 billion industry, which sells as many as 80,000 kinds of powders and pills with little federal scrutiny.

These products range from benign substances like vitamin C or fish oil to more risky mineral, herbal and botanical concoctions that can be fatal.

“People haven’t wanted to touch this framework or address this space in, really, decades, and I think it’s time we do it,” Dr. Gottlieb said in an interview. He is particularly concerned about supplements that purport to cure diseases for which consumers should seek medical attention.

“We know there are effective therapies that can help patients with Alzheimer’s,” he said. “But unproven supplements that claim to treat the disease but offer no benefits can prevent patients from seeking otherwise effective care.”

The companies included TEK Naturals, Pure Nootropics and Sovereign Laboratories. In a letter to TEK Naturals, the F.D.A. and the Federal Trade Commission chastised the company for marketing Mind Ignite as a product “clinically shown to help diseases of the brain such as Alzheimer’s and even dementia.”

In response to a request for comment, TEK Naturals said in an email that it was reviewing the letter and was committed to complying with legal requirements.

Dr. Peter Lurie, president of the Center for Science in the Public Interest, a nonprofit advocacy organization, said the F.D.A.’s warning letters called attention to the lack of regulation.

“Each time they issue a new one, it hopefully acts as a shot across the bow for that segment of the industry,” said Dr. Lurie, a former associate commissioner with the agency.

He also expressed frustration that the F.D.A. had spent years debating policy that would encourage manufacturers to notify the agency of new dietary ingredients but had not yet released it.

Dr. Gottlieb said the F.D.A. would create an online watch list of specific ingredients the agency was concerned about.

The F.D.A.’s oversight is based on a 1994 federal law, which imposed minimal reporting and labeling requirements on the makers of vitamins, minerals and herbs — a fledgling industry at the time. To prevent a company from selling a product, the law requires the F.D.A. to prove that it is unsafe. The agency says it is difficult to track the myriad products, many of which are sold on the internet.

The law also requires businesses to notify the F.D.A. that they are making a dietary supplement, but not to say what’s in it.

“That just makes it impossible for the agency to police the market,” Dr. Lurie said.

The 25-year-old law has drawn increasing criticism as the sector has grown. There are now between 50,000 and 80,000 dietary supplements on the market, according to the F.D.A. The agency also says that three of every four American consumers now take a dietary supplement regularly. For older Americans, the rate is four out of five.

In recent years, the F.D.A. has cracked down on several sectors of the industry, including dietary supplements sold for weight loss, sexual function and energy enhancement. More recently, one of the biggest targets has been kratom, a botanical substance that is marketed as a safe alternative for opioids or to help opioid users’ withdrawal symptoms. The F.D.A. has ordered that kratom imports be seized and told companies not to use it in supplements. The agency has linked several deaths to kratom.

Steve Mister, chief executive of the Council for Responsible Nutrition, which represents the dietary supplement business, said he believed the dietary supplements industry was “remarkably safe.” He also said the current law struck the right balance between ensuring safety and giving consumers access to affordable products.

“These products are not drugs and should not be regulated like drugs,” he said. Mr. Mister also said his group supported the F.D.A.’s enforcement actions, and had been working with Congress to increase the program’s budget.

Medicare and Medicaid are better than private insurers at keeping spending per-beneficiary low, a finding that has crucial implications for the current health policy debate, according to a new report.

The Urban Institute dived into data from the Centers for Medicare & Medicaid Services’ national health expenditure reports from between 2006 and 2017 and found that per-enrollee spending increased by 2.4% each year in Medicare and 1.6% each year in Medicaid, while it went up by 4.4% annually in private plans.

However, overall spending increased more quickly in the two federal payers than in the commercial market. Spending in Medicare went up by 5.2% per year and by 6% per year in Medicaid, compared to 4.4% in private coverage.

Those spending increases shouldn’t be cause for alarm, though, the researchers said. During the study window, enrollment in Medicare and Medicaid increased dramatically, thanks to an aging population and expansion under the Affordable Care Act, which would account for the overall spending increases.

The gap in cost containment runs counter to the idea that Medicare and Medicaid are the main drivers behind spending growth, according to the study, and instead points to private insurance as the problem.

“Medicare and Medicaid are doing a good job of keeping per capita costs under control, though the continuation of recent polices is essential,” John Holahan, a fellow at the Urban Institute and one of the report’s authors, said in a statement emailed to FierceHealthcare. “The larger cost containment problems the nation faces are in the private insurance market.”

The findings should call current health policy initiatives into question, the researchers said. Policy proposals can impact Medicare and Medicaid in different ways than they impact private insurance.

For example, spending on drugs was the major source of growth in Medicare, while spending on hospital care was the driver in the private market, the researchers found. So while policies targeting drug spending in Medicare pay off, they might not get to the heart of the problem in private insurance.

On the other hand, public payers have greater leverage to negotiate with the increasingly consolidated hospital market, so policy approaches to address rising hospital costs will need to account for that, the researchers said.

In addition, the study calls into question the need for far-reaching restructuring of Medicare and Medicaid, as has been proposed in several forms to address rising spending. As enrollment, and not individual spending, is likely the driver behind higher spending in these programs, major restructuring may not be necessary.

“There is no need for major changes to Medicare and Medicaid that would reduce coverage and cause financial hardship,” Holahan said.

UPDATE: Feb. 5, 2019: The American Hospital Association pushed back on the Health Affairs findings in a statement Tuesday afternoon, saying the authors “use limited data to draw broad conclusions.” AHA President Tom Nickels noted that the study uses data from employer-sponsored plans and doesn’t include Medicare, Medicaid or Blue Cross Blue Shield claims. Also, hospitals have expenses doctors don’t, such as administrative expenses, regulatory compliance, drugs and medical devices, he said. “We recommend in the future that such studies take into account all these factors,” Nickels said.

Dive Brief:

Hospital prices for inpatient care grew 42% from 2007 to 2014, substantially faster than the 18% growth in physician prices over the same time period, according to a new report published in Health Affairs.

Researchers found a similar trend for outpatient settings, with hospital-based care growing at 25% compared to physician prices rising 6%.

The findings suggest that policy measures aimed at cutting healthcare costs should focus on issues like antitrust enforcement, incentivizing more cost-efficient physician referrals and reference pricing, the report authors said.

Dive Insight:

The report comes amid a wave of M&A with providers seeking to buttress headwinds like falling inpatient admissions. Last week, Dignity Health and Catholic Health Initiatives finalized their merger creating the largest nonprofit health system by revenue at nearly $30 billion.

At the same time, HCA Healthcare said it had closed its purchase of North Carolina-based Mission Health for $1.5 billion.

Those agreements follow the marriages of Advocate Health Care and Aurora Health Care, which combined 27 hospitals and about 3,300 physicians, and Bon Secours Health System and Mercy Health, which merged to create a system with more than 40 hospitals across seven states and revenue of about $8 billion.

In the first half of 2018, healthcare M&A activity surpassed $315 billion, nearly doubling the amount from the first half of 2017, according to Thomson Reuters. Deloitte has even predicted that current merger trends would result in only half of the current health systems remaining in the next 10 years.

Beside those horizontal transactions are the vertical megadeals like CVS-Aetna and payer combinations such as Cigna-Express Scripts.

The Health Affairs authors suggested more vigorous review of mergers at the state and federal levels, as well as regulating hospital payments or instituting reference pricing.

“Our work suggests that instead of focusing on growth of physician prices (which have grown roughly at the pace of inflation), in the short run policy makers should devote more of their efforts to addressing growth of hospital prices,” they wrote.

And while states are putting greater scrutiny on provider mergers in their areas, lack of competition and the effect that can have on prices persists. In a recent report, the Center for American Progress argued that M&A has restricted patient choice instead of cutting costs.

“The current state of healthcare provider markets demands stronger enforcement by federal and state antitrust authorities, policies to support more robust competition among providers, and limits on prices in already concentrated markets,” the group wrote. “Any efforts to control healthcare costs and improve care for patients should consider the growing role of market power.”

Some studies back that up. A report from the University of California-Berkeley found an association between highly concentrated markets in the state and higher hospital and physician prices. The northern part of the state had 30% higher costs than the southern part. That led to legislation to roll out a pricing database by 2023, and the state’s attorney general to file a lawsuit against Sutter Health charging anti-competitive practices.